Let me paste the article that Adongo linked here. Its really important to see the brazen theft led by none other than Uhuru Kenyatta himself. Its serious that a president is now heading the open looting of the country coffers.
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THE famous Chinese proverb May you live in interesting times has never been so real. These are interesting times indeed. You know you are living in interesting times when sane adults start chopping off their noses to spite their mouths. You know you are living in interesting times when your democratically elected government goes rogue with skewed national security policies and the opposition growls like lost urban guerillas.

The Asman Kamama led parliamentary committee on National Security must be commended for having the courage to demand suspension of the Sh15 billion surveillance contract awarded to “Safaricom.” Soon Kamama and his team will be branded as “brokers” for questioning the contract. Suspending the “Safaricom” contract award is not enough. Let me explain why.

The secrecy adopted by Jubilee when it comes to revealing the details of the loans, deals, contracts and tenders they have been signing left, right and center is alarming. Why is there so much secrecy? What is the government hiding? The President and his government have waxed themselves lyrical letting the world know that 1,800 CCTV cameras will be installed soon. Thanks, the terrorists and criminals now know what you intend to do. Please let Kenyan taxpayers also know why “Safaricom” was single sourced for this contract. Safaricom is not the real contractor but first we must understand why this contract is controversial.

Whereas nobody denies that CCTV cameras may deter petty criminals; it would be naïve to think that al Shabaab jihadists will be wetting their pants at the sight of a CCTV camera. I doubt the growing number of suicide bombers would be deterred from detonating their IEDs just because some camera somewhere will spot them. They do it in broad daylight anyway. What would be a more prudent way to lower incidences of terror attacks with the fierce urgency of now is embarking on programs to counter what drives young men and women into crime and terror.

Second, Kshs 15 billion for 1,800 cameras translates into approximately Sh8,333,333 or USD 95,000 per camera. An instant online quotation from Cisco, the World’s number one supplier and installer of CCTV surveillance cameras and networks reveals a significantly lower figure. The cost of the equipment and installation of the network in areas that already have their own fiber optic cables averages between USD 5,000 and $8,000 per camera. To illustrate this further, one needs to look at the city of Leicester in the UK which recently installed 2,083 cameras at a cost of GBP 14 million or Sh2.058 billion. Leicester thus got almost 300 cameras and spent seven times less than Kenya intends to spend. Simple arithmetic!

Finally, it sounds really nice when the President and his team carefully repeat Safaricom, Safaricom, and Safaricom. Safaricom does not have the capacity to fulfil such a contract. This tender was awarded to the Chinese telecommunications giant, Huawei with Safaricom being used as a mere cover. Why? In or around August, 2010 Safaricom selected Huawei as its vendor of choice for the supply of its core network requirements and roll out of the 4G network at a cost of Sh12 billion. According to cellular-news.com, then Safaricom CEO Michael Joseph travelled to Shenzhen, China and signed three year agreement on August 31, 2010. The Kenya government is now ready to pay Safaricom Sh15 billion.

Huawei, like other leading Chinese telecommunication companies is directly linked to the Chinese military. In essence the “Safaricom” contract means we are outsourcing our surveillance and intelligence to the Chinese government. Uhuru Kenyatta describes this project as the magic bullet. Unfortunately there is no magic bullet here because Huawei/Chinese network equipment comes with the Magic kill packet which allows back door penetration by the supplier-in this case the Chinese military. This in simple language exposes our critical national security infrastructure to the Chinese military.

Huawei’s 15-20 year plan is to beat Cisco. To achieve this goal, the quasi-government company has stretched itself thin. Because of its connection to the Chinese military and easily attackable network, Huawei was barred from the North American, Australian and most of Western European market.

Huawei intentionally allows different clients to share the same server which in the process exposes one client’s information to others through the deliberately open “back door.” This explains why the Safaricom a.k.a Huawei’s server was shared by the IEBC and TNA during the controversial transmission of last year’s election results. Imagine a situation where our intelligence and surveillance services are shared with al Shabaab or al Qaeda posing as other Safaricom a.k.a Huawei’s clients. This contract is a bigger national security threat than the NSA exploiting Huawei’s “back door” access to listen in on the Uhuru’s conversations.

I think that Uhuru and Ruto will go down in history as having led the most tribalistic government in the history of the nation. Here are people who do not care about anything but their pockets. They have given their appointees free hand to fire people from other tribes and replace them with their own. Leaders with conscience would have been walking in shame but not these two. Its a war of attrition between the Kalenjin and Kikuyu. Other tribes are just watching from the sidelines.

Chinese workers on the standard gauge railway at Mackinnon area while doing a feasibility study of the soil ahead of construction in this picture taken on 10 Feb 2014. PHOTO: Laban Walloga/NATION

By David Ndii

So far, the raging debate on the proposed standard gauge railway is focusing on dodgy procurement.

There are also questions about the cost although, on the whole, it is not evident that it is grossly overpriced. Many people seem to be under the impression that it is otherwise a good investment. It is not.

Three hundred billion shillings is not loose change. If it proceeds, it will be the biggest loan that we have borrowed to date. It will increase our external debt by close to one third, our debt to GDP ratio by nine percentage points and our interest payments on external debt by 50 per cent.

The annual repayment of the principal amount translates to over Sh600 million per county – you may want to think what your county could do with an extra Sh600 million every year for the next 10 years.

If we are going to put ourselves in debt to this extent, we need to be sure we are getting value for money. Are we?

I have a simple back-of-the-envelope method I use to check whether a project makes commercial sense.

At the very minimum, a commercial project should pay the cost of capital. Let us put the cost of capital at 7.5 per cent per year, about the rate that we can expect to pay on the sovereign bond we are about to float. This means that the project needs to generate a surplus of Sh22.5 to pay for capital.

To generate this kind of surplus, the railway would have to have a turnover of at least Sh120 billion. Assuming that it charges the prevailing tariff of US$1,000 per container, it would need to carry 1.4 million 20-foot containers a year, 4,000 a day. That would take about 48 very long trains every 24 hours. The busiest single line railways in the US, for instance, run 20 trains a day.

What about cargo? The Mombasa port is now handling containers about one million TeUs (twenty feet unit equivalent). That means the new rail would have to enjoy a monopoly of Mombasa port cargo to pay its way. This is probably why the Chinese financiers are asking for guaranteed cargo. But what they do not seem to appreciate is that the Kenya State does not have the same command and control power that the Chinese State has.

One can argue that the cargo volume will grow. That is true. But we are not demolishing the old line. And the new one comes only to Nairobi at first.

It does not make sense to load cargo going beyond Nairobi on the new line only to transship it to the old line that could have carried it from Mombasa in the first place.

TANZANIA’S CENTRAL LINE

More importantly, the region is building competing transit corridors not least our very own LAPSSET. But the most immediate competition is Tanzania’s central line. This line goes from Dar-es-Salaam to Isaka, about 100 km south of Mwanza. It is being extended to Kigali, with a branch line to Musongati in Burundi. At 1,400 km, the distance from Dar to Kigali is 25 per cent shorter than Mombasa to Kigali.

If our Chinese friends make good their pledge to build the mother of all ports at Bagamoyo, Mombasa will have a hard time competing for transit cargo to and from Rwanda and beyond.

The Lamu port, if completed, will also take a chunk of domestic and northbound cargo. And Djibouti is also angling for South Sudan and Ethiopian business as well. No massaging of data, or growling at critics, will make this railway make commercial sense.

The long and short of it is that the railway will be paid for by taxpayers’ money. Our constitution has set out five principles that public finance must fulfill. Two of these are pertinent.

Article 201(c) requires inter-generational equity that is fairness between current and future generations. Article 201(d) requires that public money be used in a prudent and responsible manner. Let us take 201 (d) first.

The fact that the railway cannot pay its way does not mean it is imprudent. It may be that it has huge indirect public benefits which are not captured by the revenues — what we call in economics positive externalities, are very high.

A good example of this was JF Kennedy’s mission to put man on the moon. Its direct economic returns were zero, but the technological advances it engendered are said to far exceed its cost.

But it is hard to see what the public benefits beyond those that accrue to the owners of the cargo that is carried are. And the fact that alternative modes of carrying cargo on the same route, including modernising the existing one, means that even the additional economic benefits to those are not that significant.

LAMU TO THIKA

If we must build a railway, it is doubtful that this particular one is the best value we can get for our money. It seems to me that a new line from Lamu to Thika represents better value for money. Three reasons.

First, it is a cheaper and faster alternative to the proposed LAPSSET route, as there is already a line from Thika to Nanyuki that only needs rehabilitation. All it would require to make LAPSSET a reality is a container terminal in Nanyuki and a good road from Nanyuki to Juba, as the road to Ethiopia is already under construction. The economic rationale for replicating the Mombasa-Nairobi line when we are struggling to secure funding for the LAPSSET infrastructure has totally escaped me.

Second, it would connect both the Northern Corridor and the proposed LAPSSET corridor to both Mombasa and the new Lamu port. Choice for the customer, and competition between the two ports, can only be a good thing.

Third, it will stimulate development of the historically marginalised regions along its route. It will carry livestock and livestock products to the ports for export, coal and cement from Kitui, and food from the million acres of the lower Tana that we are about to irrigate.

Let us now consider 201(c), the inter-generational equity provision. This provision requires that we do not burden future generations unnecessarily, and vice-versa. It would be unjust to borrow money to consume today, for example, to throw the Golden Jubilee party, which would be repaid in 20 years.

That is obvious enough. What is less obvious is that it is equally unjust to tax poor people today for an investment that will benefit future generations who, in all likelihood, will be wealthier than we are today.

It should be readily apparent that taxing people who don’t have enough to eat to finance a project whose benefits will be realised in 50 years is as unconscionable as burdening our children and future generations with debt whose benefits they will not enjoy.

BORROW LONG-TERM

So, how else then can we finance such a long-term investment as a good railway project? There are various ways, but the most obvious is to borrow as long term as possible. As it happens, we do have access to long term cheap loans from the World Bank — 40-year maturity, 10-year grace period at 0.5 per cent interest.

If it were World Bank IDA or the African Development Bank’s (ADF) money, the repayment works out to a third of the Chinese loan, and we will not start paying until 2024, by which time the economy will be much bigger, there will be a lot more cargo to carry, and in effect, the public financial burden less onerous.

But this funding will not be available for long, as it is only available to the poorest countries, a status that we will soon graduate from. What a smart government would do is take advantage of this to finance as many long term capital projects as the World Bank and AfDB are willing to finance.

There is no shortage of commercially viable infrastructure projects, energy ones notably, for the Chinese to finance. At any rate, the Chinese are likely to win most of the construction work even when it is competitively tendered.

It’s hard to see what is smart about getting into the kind of murk they now find themselves in on this project. All it does is to reinforce the negative perceptions that many people have about the way they are doing business with African governments.

It is a lose, lose, lose project. We lose, the President loses, the Chinese lose. It is not worth it.

Adongo, it is hard to believe that Kenya is slowly going back after the struggle to get Moi out, starting with the attempt to gag the media. What is especially incredible that there are people at the top whose thinking did not move. It will be interesting to see the outcome of this one and how Kenyans react to Kimemias onward to the past style.

John D,
I think its now that people are starting to appreciate the role RAO has played for the past few decades. No one is able to take from him and checkmate the government the way he has done. All these others have all of a sudden lost their voice. Raila cannot be a one man army forever.

Uhuruto are having a field because they own the very media outlets that are supposed to check their excess. The media just sings songs of praises or keep quite.

We know about the scandals that have been going on but the media would rather concentrate on ODM elections.

Its a pity that people now think that the Moi regime was better than this thing called jubilee.

Uhuru who always thinks he is already back in the Moi era is now busy issuing roadside decrees about salaries. Nonsense. Uhuru has no powers to order how much money state officers can be paid. That is the work of the SRC.

The last time the SRC trimmed the salaries and benefits of M.Ps they refused it and worked with Uhuru and Ruto to pretty much double their benefits to almost Kshs 900,000. a month. That added billions every year to the national expenditure. That was the bombshell that started the scramble for huge benefits for all state officers. Uhuru and Ruto played a big role in giving the M.Ps what they wanted. Now their are into gimmicks of pay cuts.

Uhuru and Ruto took a 20% cut announced during a four day lavish retreat in Nanyuki. This after the same government circulated a memo announcing that state events will not be held in expensive luxury resorts but rather in state facilities. Now they say oh there was need for security. Rubbish. What can be safer that state house where these people meet all the time.

Now do the math. Uhuru and Ruto’s pay cut will save the tax payer about Kshs 300,000. from each of them. That is a grand total of Kshs 600,000. Now the four days Uhuru and his crew spent at the hotel cost the Kenyan taxpayer a total of Kshs 33 million. So we spent Kshs 33 million to save half a million. Great thinking.

The real thing Uhuru and Ruto want to do is find a way to fire more than 100,000 civil servants. They know it is going to cause an uproar and they are playing these funny games to claim they are doing their part. Uhuru and Ruto have tough job of sorting out the nation’s finances. It will not be done through gimmicks. In fact the gimmicks and the retreats tell us these guys have no plan and have no idea what to do. That is scary.

Already the national government is offloading civil servants to the counties while they keep the money that was budgeted for the pay of those civil servants in the national government. Paying for medical services alone can take all the 15% of the budget that is allocated to the counties.

If the wage bill is stiffling the national government which keeps 85% of the budget imagine what it will do to the counties. The county governments are going to be become a payroll agency and nothing else. This whole thing needs to be thought through and even the revenue allocation formula revised to reflect the reality. The doctors are fleeing public services in huge numbers. That whole system is going to collapse. Then agriculture is next.

Then of course we have mega corruption. Look how the whole railway circus is being thrown under the carpet. The phony kamanda committee which did not even have the authority to investigate the matter have already giving their state approved report to parliament. The PIC have gone dead silent. Go slow. Again. And we are talking hundreds of billions.

And now here comes the filthy mouths of Duale and Kindiki. Duale wants the constitutional commissions reduced to 3 members each then he will cut his salary by 15%.

Don’t we just have a grand country. M.Ps doubled their untaxed allowances. Now Duale is saying he should kill the commissions then he will have mercy on Kenyans and reduce his salary. How did things get this bad.These are the same people who have said they have to determine their own pay and do not want to be called state officers.

Abolish the damn senate to begin with. But it seems the whole wage bill matter has been reduced to a comical show. These jubilee chaps are over their head. They take something so deadly and serious and turn it into a practical joke. Keep it up.

You could not have been more correct. DP Ruto negotiated a back door deal with MPs one year ago, and awarded MPs and Senators Kshs1.1 million shillings each per month. I was working out these costs per year and my calculator could not accomodate the sums.

Thanks for posting the ODM proposals. I saw a bit of that in the Star but they made it appear as if it was just some ideas from Nyong’o.

But I agree with them on a few things.

1. It is mind boggling that Uhuru is crying about the wage bill which is unbearable while saying nothing about the illegal duplication of running the provincial admnistration under a different name. We have hundreds if not thousands of DCs and DOs with an army of civil servants working under them and doing absolutely nothing (May be working hard on the Nyumba kumi porojo). Good lord. Why are we paying these people while begging other civil servants to accept pay cuts as ordered by muthamaki.

In terms of the wage bill, what we have is Kshs 543 billion a year going to civil servants now. That will shoot up by about 25% by end of next financial year . Then we Kshs 300 billion as interest on debts. Add over Kshs 80 billion in pensions. If you look at it we have a situation where close to 80% of the GDP goes on non discretionary concurrent expenditure. Whatever remains out of that is not enough even to just buy medicine for the hospitals and other materials that the state must buy to function.

Uhuru is going nuts grabbing loans in trillions with all sorts of corruption tied as we saw in SGR saga expect the interest on loans to double within the next five years. Once that happens and we can’t sort out this wage bill nightmare the country will be technically bankrupt. We will soon reach a situation where we need to borrow money to help pay the interest on debt. Nobody will give you any money for that.

As of right now the only money Kenya is spending on any sort of development is coming from loans and grants.

2. Secondly we really need to harmonize the civil servants situation between the counties and the national government. Health is going to the counties but it still has to be paid by the same tax payers.

There is only one tax payer. That is a common mantra here in Canada when they deal with allocation of tax dollars between the federal government, the provincial government and the municipalities.

In Kenya we have bastardised system which we haven’t even figured out yet. When they realize that the budget is undoable the knee jerk reaction from politicians is talking about oh reduce the counties, oh reduce the M.Ps, oh reduce the commissions. That is not the problem. The problem is that we have to streamline the civil service and ensure that the work force is necessary and productive.

Look at this scenario. The counties inherited the former workers of the Local Government institutions. These are tens of thousands of workers whom they have to keep paying even when they don’t know what these people are really doing (mostly nothing). This is 75% of the County Payroll. How can this be justified. Never mind that the counties inherited huge loans and liabilities from the Local Government institutions most of which were dysfunctional to begin with. The counties are making this bad situation worse.

How in hell is something like this even possible. A company which should not even have been invited to make a bid comes and takes the laptop money in a brazen abuse of the very conditions set by the ministry. And Kaimenyi had the nerve to lie to Kenyans about how he had saved Kenyans Kshs 8 billion.

Someone like this need to be fired on the spot if Uhuru wants anybody to listen to him. But we know one thing. Stuff like these are not done by the minsters. This is the work of the mashetanis at State House. At least the committee handling this issue were not lapdogs like the kamanda committee. But really Uhuru needs to be ashmed of himself with stuff like this.

4. This piece deals with the other aspects of this wage bill issue that we have to pay attention to. Perks and allowances in Kenya are just plainly obscene and it starts with M.Ps. Committees drag on forever because M.Ps want to get Kshs 10,000 daily sitting allowances.

Here is what smart folks are saying about the other Uhuru pet project which just like the laptop protect is engulfed in false starts and massive corruption. Will Uhuru listen? It might not even be up to him. He works for the mashetanis and they got the right boy for the job.

Adongo,
I guess that where you live in Canada, the incoming government does not just close down/forget projects initiated by the outgoing government. Decisions that have been made democratically are never reversed just because of this or the other pet project.

Jubilee is so knee deep in ways and means of stealing that they cant even figure out how to move the country forward. We know that their agenda was ICC but cant they even pretend to be seen working? These chaps had zero vision and programmes for the country except laptops which they cant manage.

We might end up with white elephants littering the whole country. Here is what Im talking about.
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When President Mwai Kibaki was handing over the reins of power, he said his regime had laid the foundation for future growth.

This included numerous infrastructure projects that had been proposed and others that were ongoing. The assumption was that the Jubilee government would accelerate these projects as key drivers of economic growth.

But a year down the line, most of the big projects initiated under the Kibaki regime are suffering from what experts term as lack of leadership and commitment from the government to push them to completion. Some have stalled amid accusations of corruption while others have been affected by shifting priorities.

KONZA TECHNO CITY

Then President Mwai Kibaki commissioned the planned Konza Technopolis on 23 January, 2013. In the months following the pomp of the ground-breaking ceremony, Konza has remained dormant.

With Mr Kibaki and his technology point man, Dr Bitange Ndemo, out of office, Konza seemed to lose steam. 2013 closed without the promised construction taking off as key legislation stalled.

At a forum last month, Makueni Governor Kivutha Kibwana complained that the allocations made in the Jubilee government’s first budget barely scratched the surface of what is needed to be done. In the 2013/2014 budget, Konza was allocated Sh793 million.

The project is expected to cost Sh800 billion over two decades. Most of this will come from the private sector partners but the government is expected to invest heavily in basic infrastructure.

Prof Kibwana called on President Kenyatta to take a more proactive role in steering its development.

While Konza has stalled, Machakos Governor Alfred Mutua is forging ahead with his own techno city, which some stakeholders see as rivalling Konza.

President Kenyatta has supported this project, having presided over its launch in November last year. In the early months of 2014, the government seems to be regaining interest in Konza. National Environmental Management Authority approval was granted in February while the University of Nairobi has been commissioned to carry out a survey to pave the way for construction.

KRA’s PROPOSED SPLIT

Nearly two years after the government first announced plans to establish an independent customs unit, the plan is yet to take shape.

In his first, and last, budget speech in 2012, former Finance minister Njeru Githae said the government would hive off customs from the Kenya Revenue Authority (KRA).

The creation of an independent customs department was to prepare Kenya for the establishment of the Customs Territory as envisioned in the East African Community Common Market Protocol.

In June 2013, Treasury Cabinet Secretary Henry Rotich reiterated the statements. The envisioned Customs Services Department was to be given the “primary mandate of trade facilitation and effective border control”.

However, in an interview last month, Mr Rotich said Treasury was still grappling with an ideal model for the new customs unit.

Further, the Treasury is considering retaining collection of duty at ports of entry with KRA.

MAVOKO HOUSING UNITS

Then President Kibaki launched a housing scheme of 30,000 units, expressing confidence that construction would commence in a few months.

“It is commendable that the National Social Security Fund (NSSF) will shortly embark on developing (the housing scheme),” said Mr Kibaki at the fund’s first annual general meeting in 47 years.

But the project that he said would include infrastructure to transform Mavoko Municipality into a city-within-a-city is yet to take off. The project was to be funded by NSSF and was touted as one the flagship initiatives under the Vision 2030 blueprint.

The project has experienced difficulties due to the goings-on at the pension fund, first with Cabinet secretary Kazungu Kambi suspending all projects to pave the way for an audit amid corruption claims. The latest information has it that the time extension was meant to attract investors with the required funds. “We did not get the right investors and because it is a public-private partnership, we had to extend the period,” said

communications manager Christopher Khisa. The houses, which were to be built on a 960-acre piece of land, would be the fund’s largest real estate project.

HIGH GRAND FALL DAM

The 96km² dam was proposed under then President Kibaki’s administration and was to border Tharaka-Nithi, Kitui, and Tana-River counties at Kivuka along the Tana River.

Construction was approved in 2009 as part of an ambitious effort to build 1,000 water reservoirs across the country to revolutionise irrigation-based farming.

It was also to generate between 500MW and 700MW to feed the proposed Lamu resort city and port. All indications were that the government had secured funding from the Chinese government and the only thing that was subject to discussion was the make of the turbines for the power generation part of the project.

While the ministry insisted on getting German-made turbines — which are widely used — China demanded use of Chinese turbines.

Mid last year, Deputy President William Ruto reversed all this by halting the project on grounds that a cartel had over-estimated the actual construction cost and that the government stood to lose a lot of money.

A fresh technical evaluation was ordered, the report of which was handed in on January 8, 2014.

THE MISSING ROADS

Two major road expansion projects meant to ease movement of traffic in Nairobi are yet to take off despite the fact that the government has secured funds from donors.

Nairobi’s first double-decker highway, which is to cover the traffic bottleneck stretch between the Nyayo Stadium roundabout and Westlands and funded through a Sh25.5 billion loan from the World Bank, is yet to start. The government is expected to provide Sh9.5 billion.

It includes expansion of Waiyaki Way that begins at the Westlands roundabout to create an extra lane for commuter buses up to Rironi.

The double-decker road project is expected to ease the gridlock on the Northern Corridor that passes through Nairobi while facilitating faster movement of traffic from the suburbs.

Those expected to benefit include travellers heading to Jomo Kenyatta International Airport.

Heavy traffic on the road slows movement of vehicles, inconveniencing both local and international travellers. The government had said the road would be completed by 2016.

Expansion of Ngong Road into a dual carriageway received funding of £20 million (Sh1.7 billion) from the Japan International Cooperation Agency (JICA) in June 2012 but the construction is yet to begin.

During the signing of the funding agreement on the road upgrade, the government said the work was expected to commence in a few months, with a projected completion date of February 2015.

The road, which leads to Nairobi’s central business district and the south-west suburb of Karen, is a constant gridlock for city motorists, particularly the stretch between the Adams Arcade roundabout and the Kenyatta Avenue crossroad.

Completion of the road project was expected to lead to a significant decrease in congestion.

It is estimated that Kenya loses over $500,000 (Sh42.5 million) a day due to traffic congestion in the greater Nairobi area, primarily due to non-productive time spent on the road, a recent study by IBM Corporation shows.

According to the Kenya National Highways Authority director general Meshack Kidenda, the new road will transform Nairobi’s infrastructure setup to that of a modern city with service lanes, allowing rapid movement of commuter buses and connections with other transport services like railways and airports.

IRRIGATION SCHEME THAT FAILED TO GROW RICE

In 2008, the Grand Coalition Government of Mwai Kibaki and Raila Odinga had a dream of expanding the Mwea Irrigation Scheme by another 16,000 hectares. Six years later, the Sh12 billion ambitious project remains just that — a dream.

The people of Kirinyaga County have learnt to suppress bouts of hope as the relocation process hits a snag, year after year.

The matter is further exacerbated by the fact that the Jubilee government no longer counts it as a key project.

Here is the irony: It was Mr Uhuru Kenyatta who penned the deal with Japan in 2010 to facilitate expansion of the irrigation scheme when he was Finance minister. The Mwea Irrigation Scheme has 30,350 acres, out of which 16,000 are under paddy production every year.

Construction of a water dam project at Rukenya village in Gichugu constituency, which is an integral part of the expanded scheme, is yet to take place.

The board facilitated with the process is still holding talks with landowners who have refused to surrender their farms because of “unreasonable” compensation.

The expansion is meant to unlock production of about 300,000 tonnes of rice annually against the current 80,000 tonnes.

Exactly what we said. The Uhuruto bumblers spend a fortune to “save’ pennies by decrees. This is not working at any level. It can’t and wont work. Kenyans are not as stupid as these people think. Thank you very much.

Jubilee war with the donors who support the Kenyan health, education and governance initiatives are going to be very costly for Kenyans.

Like I said before, the Centre for Disease Control (CDC) is moving its operations to Tanzania. They have been doing a hell of a job in Kenya in just about every county working with KEMRI. They are folding their operations but will leave their health infrastructure for the government and the counties to run. Good luck with that. May be China and Russia will step in. Good luck with that too.

The article is still way off in terms of the impact of the huge borrowings expected to finance the already shaddy SGR. Uhuru is going to need over Kshs 1.2 trillion. A similar amount if not more is required for the LAPSSAT. When all is said and done it is estimated Uhuru’s pet projects could increases the national debt by 30%. If that happens the country will be financially dead.

And the huge wage bill and robbery of state money must contnue without let down. Yesterday I saw an article about the current audit of state resources indicating about Kshs 500 billion has been squandered.

For those who have been paying attention to these issues, keep your eyes open. Stuff is happening right before our eyes. The panic about the wage bill is because those who know what is going on are telling the paper boys in office that their is a financial tsunami Kenya has to face in a year or two. The paper boys don’t know what to do. One day they cut their pay by 20% for political optics, the next day Uhuru orders that MCAs should be given grants to buy cars. That is Kshs 6 billion for this year alone according the SRC commissioner who says it is nonsense. But who cares about what she says.

This thing is getting messy by the day. Talk about financial suicide. Yes, Uhuru spends close to 100 million to announce a 200 000 pay cut. Then he goes on to award 6 billion to the MCA´s. (By the way, SRC commissioner has not heard from them about the cut, in other words it was just a gimmick) This is happening as doctors, nurses, teachers and university lecturer are demanding higher pay. William Rutos answer to the wage bill that died in the water a couple of months ago was to drastically reduce the number of civil servants. But just as most of the jubilee experiments it reached nowhere.

While all this is happening, the Kenyan parliament is busy enacting with useless laws that add no value. Here is what I’m talking about.http://www.capitalfm.co.ke/news/2014/03/cabinet-secretaries-governors-wont-fly-kenyan-flag/
I thought that the flag was for all Kenyans not only the President, Deputy President, the two Parliament Speakers and the Chief Justice. How primitive can the parliament be. In any developed country anyone can fly a flag on his car, bicycle, tuktuk or whatever. What the MPs should have done would have been to extend the use of the flag to themselves and any other Kenyan. I think that sirens and driving on the wrong side of the road is worth banning but not flying a national flag.

Anyway, the greatest issue is the war on corruption that is completely lost. Even Kibaki used to pretend that he was fighting corruption. The current amigos just don’t care. Its as if they encouraging the vice.

On July 29, 2011 – the World Bank (of which Kenya is a member) DEBARRED China Communications Construction Company (CCCC) Limited, and all its subsidiaries, for fraudulent practices in Philippines. The suspension runs to January 2017. CCCC is the designated successor entity to China Road and Bridge Corporation CRBC), which GoK has via Kenya Railways Corporation has awarded the multi-billion standard gauge railway project on single sourcing basis.

On January 18 2014 ( just three weeks ago), as Hon Alfred Keter was making noise over the SGR project, it was the turn of Kenya Ports Authority to award tender number KPA/062/2012-13/ID via “Restricted Tender” procurement method to none other than China Communications Construction Company. The contract amount is an eye-watering KES 18,992,419,922.40 billion for construction of the First Three Berths and Association Infrastructure of the Proposed Lamu Port at Manda Bay.

This multi-billion dollar contract signing at KPA was happening at about the same time that the CRBC file was stolen at the Registrar of Companies just before Parliament summoned PS Nduva in a sitting aimed at unmasking the faces behind the local incorporation of the CRBC. One wonders what happened to automation at Sheria House? On its part, KPA claims it received 6 bids, but it is unclear how a debarred company emerged the winner in a competitive bidding process that they opted to restrict to suppliers of their liking.

So even as controversy was raging over the SGR scam, World-bank debarred CRBC/CCCC was still getting public procurement deals under very opaquely dubious circumstances. No due diligence, no open tendering, no local incorporation file at the registrar of companies, the faceless Anglo Fleecing b*stards are back in full swing!

Coincidentally and quite interestingly, Ambassador Francis Muthaura was gazetted as Chairman of the LAPSSET Corridor Development Authority (which has a role in this deal) effective from January 10, 2014. Amb. Muthaura was Head of Civil Service and Secretary to the Cabinet when the Anglo-Leasing Scam was mooted. The same gazette notice that appointed Muthaura also appointed another TNA/Jubilee diehard Danson Mungatana as the chairman of Kenya Ports Authority, for an unusual short mandate of ten months only. It is unclear what the role of these two is in this deal, or in other projects, but clearly Jubilee government wants to ensure trusted hands oversee these deals.

So what was that about Uhuruto fighting corruption when the very individuals who forced Githongo into exile over Anglo Leasing are the same ones behind the Chinese drive of large infrastructural projects using internationally mega-fraud indicted companies? Jubilee fighting corruption is nothing more than an absurd fallacy.

This thing has no standing in our laws. It has no terms of reference. It has no powers to do anything and yet it is supposed to be the grand anchor to stop theft and robbery of public funds and resources by state officials.

What has the PAC done so far? Nothing. What has the PIC done so far? Nothing. What has EACC done so far? Nothing. Now why should anybody believe that bringing members of these impotent institutions under some new ad hoc body minted in State House will achieve anything. You add nothing with nothing you will get more nothing. Ruto, please find something else to do. Kenyans are sick of gimmicks.

Uhuru says for this war on corruption to succeed he is starting from the kindergarten. I am shocked he is not starting it from the maternity wards as soon as the little thieves are born. I am sure he is going to figure that out pronto.

The thing I find very odd about Uhuru Kenyatta and his deputy is that they don’t even seem to be serious about doing anything constructive. It is as if they believe that by talking enough things will change. Just today I had a very good laugh from a list of jokes a Kenyan friend sent me about his warnings to different groups. Somehow he seems convinced that all he needs to do is warn people.

Adongo,
Perhaps this is just a new way of “eating” . I mean the so called Accountability Kenya (AK). Uhuru Kenyatta and his political pimps like William Ruto are very creative when it comes to inventing better ways of fleecing the country and before you know it, billions are in their pockets.

What a better way of pretending to do anything by putting together failures to keep doing nothing. These are tested and proven failed institutions, yet they are now tasked with the all important task of accountability.

Just as John Dibbley has mentioned, the Uhuruto crew is not serious about anything. It seems that being at the top has so mesmerized them they don’t have a clue on where to go next. Hence all the warning that are just but empty.

What Uhuru Kenyatta does not understand is that terrorists and poachers do not fear warnings and no action. They must be laughing their heads off. Afterall even the Westgate siege has not been resolved. The government does not know how many terrorists were in the building and even if any were killed.

If our useless KDF were defeated by less than 10 terrorist having nothing but a few AK47´s, what do they really care about Uhuru warnings. At any rate, they enter the country and kill people at will. That’s what they have been doing in Mombasa and so far no one has been arrested.

Guys dont laugh for this is serious.
Uhuru Kenyatta is has transffered corrupt staff from his office to other departments.

Im I the only one who thinks that this is insane. Why cant these corrupt thieving people be prosecuted instead of being moved to other departments to continue with their dirty acts. Oh my, we are in trouble have a look here.

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PRESIDENT Uhuru Kenyatta has ordered the transfer of all procurement and finance staff at the Office of the President.

More than 100 staff were affected by the changes that swept away senior officials including Director of Finance and Administration Joseph Kirubi and Government Printer Andrew Rukaria.

Kirubi has been moved to the Ministry of Mining while Rukaria is yet to be deployed.

The affected officers have been transferred to different ministries and new staff have been appointed to take over at the OP.

“In my office, there are people who think that it is a house for making money. We must agree it has to come to an end,” Uhuru on February 22. He added, “Watu wajipange. Something will happen soon.”

Ole Lenku said all staff at the OP would be transferred, except Principal Secretary Mutea Iringo. He declined to comment further.

He has also ordered a thorough audit of suppliers and procurement at the OP.

Some staff at the ministry yesterday praised the decision while others dismissed it as a PR exercise.

The sceptics said that unscrupulous businessmen have deep roots at the OP and at the Finance ministry.

Ole Lenku has also directed a review of all tenders awarded to a businessman who is a son of a Nairobi politician; a contract awarded to friends of top civil servants; and a tender awarded to an influential businesswoman with links to the Kibaki administration.

These individuals have dominated major public procurements at the OP.

Already a crisis is brewing with the police over the procurement of 7,000 G3 riffles for the regular and Administration Police.

Some senior OP officers have been pushing Inspector General of Police David Kimaiyo and his two deputies Grace Kaindi and Samuel Arachi to buy the weapons from a Nairobi businesswoman preferred by the OP bosses.

The IG and his deputies have however opted that to purchase from a factory abroad the guns for 14,000 police recruits graduating from the AP and Kenya Police colleges later this year.

Last week Deputy President William Ruto said on Citizen Television said there was no secret about the procurement of guns in the police.

Previously the Kenya Police bought their weapons directly from the factory while the AP went through the OP to buy them.

Last year, the Kenya police bought their G3 riffles abroad for Sh46,000 each while the AP bought them for Sh 96,000 each.

In February Uhuru complained that money allocated for security should be used to equip the police and fuel police vehicles and not pocketed by individuals.

Head of Public Service Joseph Kinyua has since been deployed to the OP with a mandate to review all procurements at the Office of the President.

Even these partisan newspapers are now seeing what the wanainchi have been saying all along. Namely, Kenyans are being ripped off in a meg scandal called railway project. Interestingly, no one is talking even the legislators are mum except Keter. This thing is bigger than Anglo Fleecing.
…………

By Juma Kwayera Kenya: The controversy over Kenya’s second railway tender is expected to escalate following fresh revelations that the State Law Office had raised a stink over what it terms exaggerated construction costs. The red flag, according to documents seen by The Standard on Saturday, was raised long before the construction was commissioned by President Uhuru Kenyatta in November last year. The new revelations may come as a slap in the face of the President and his deputy, William Ruto, who during their recent tour of Rift Valley berated Nandi Hills MP Alfred Keter for allegedly raising the issue at the behest of opponents of the Jubilee. In a comparative analysis of the cost of the railways Kenya and Ethiopia are building, the Attorney General Githu Muigai raised serious integrity questions about how the total cost rose from the initial Sh220, 921,502, 221.08 quoted by China Road and Bridge Corporation in its acceptance of the tender award letter dated July 2012 to the current Sh1.3 trillion. The variations are shaping the railway project into the country’s biggest financial scandal, beating the Goldenberg, Anglo-leasing and Triton frauds. The tendering concerns are informed by a comparative analysis of the railway projects being undertaken by Kenya and Ethiopia. While the Kenyan one is of inferior technology and covering half the distance Ethiopia is constructing, it was expected to cost the government $3.804 billion (Sh334.8 billion) compared with $3.9 billion (Sh343.2 billion) used by Ethiopia. The documents further show the locomotives and rolling stocks that include 56 diesel locomotives, 1,620 freight wagons, 40 passenger coaches and one simulator would have cost $1.147 billion (Sh100.936 billion). The Ethiopian locomotives and rolling stocks consisting 35 electric locomotives, six diesel shunting locomotives, 1,100 freight wagons, 30 passenger coaches and one simulator will cost $230 million (Sh20.24 billion). Construction of the 485km Kenyan railway will require $2.657 billion (Sh233.816 billion) compared with Ethiopia’s budget of $3.67 billion (Sh322.96 billion) to build 756km from Addis Ababa to Djibouti port on the Red Sea coast. The review upwards of the railway budget elicited questions from managing director of the Public Procurement Oversight Authority MJO Juma, who since March this year has unsuccessfully sought answers from the ministry over the discrepancies in the tender and raised the matter of the variations in tendering with the AG. The railway project scandal is a continuation of a “tradition” that began in 1992 which demonstrates that every time a new regime ascends to power its first mega financial undertaking is a rip-off of the Exchequer. In a letter dated March 7, 2013, Mr Juma wrote: “We have not had sight of the resultant contract signed between Kenya Railways and M/s China Road and Bridge Corporation following the negotiations of the grant between the two governments. In the absence of the contract, we are unable to discern the negotiations and contractual terms agreed between yourselves and the contractor to enable us to determine the applicability of or otherwise of not only Section 6 (1) of the (Public Procurement and Disposal) Act.”

n his reply, Prof Muigai termed the process as inconsistent with the law. “I must record that it is worrying that a procuring entity can pick and choose to alternate procurement methodologies as alleged over the same subject matter and both of which alternatives require external endorsement because neither alternatives admits open competition,” he says. The chief government legal advisor goes on to debunk the explanation given by Transport Secretary Michael Kamau that deal was government-to-government agreement. He argues that the idea should have been sealed through a treaty. “Are G-to-G a method of procurement or would such agreements merely form the basis of future traditional procurement under various areas of cooperation documented under the G-to-G? More worrying is the increasing phenomenon of government agreements employing G-to-G tool to circumvent the requirements of the…(law),” he explains. Annulled and varied It is against this backdrop the State Law Office has done a comparative analysis of the Kenya and Ethiopian railway projects. The two have argued that tendering process was irregular, although in documents seen by The Standard on Saturday, the former Kenya Railways Corporation Managing director Nduva Muli explained the variation of the procurement procedures as informed by the fact the project is government-to-government deal. In his response to a request for advice sought by the PPOA boss, Prof Muigai describes as irregular the G-to-G procurement process, saying it was not a treaty between the Government of Kenya and China. In a letter acknowledgement of the contract award, China Road and Bridge Corporation (Kenya) General Manager Li Qiang, says: “We hereby give a formal unconditional acceptance of the award of the project…exclusive of all taxes, duties and other levies such as value added tax, customs duties withholding tax, etc.” the letter puts the total cost of the railway project at Sh220 billion. According to the November edition of Fortune magazine, the Ethiopian project was to cost $2 billion (Sh176 billion) to link Djibouti to the Ethiopian capital, which includes additional works. Despite the questions being raised in Parliament how the figure jumped from Sh220 to Sh334.8 billion then Sh1.3 trillion, the Jubilee government maintains the deal was above board. The initial contract was annulled and later varied by former Transport Minister Chirau Ali Mwakwere. Mwakwere, following investigations by Inspectorate of State Corporations is remembered for similarly varying a tender for supply of two ferries for which the state paid Sh1.2 billion instead the initial Sh800 million.

The project was given the nod despite Prof Muigai and Mr Juma’s, queries about the mode of tendering, which they adjudged as irregular as it failed to meet laid down regulations. In their correspondence with managing director of Kenya Railways Corporation Nduva Muli (who incidentally is Transport principal secretary), Prof Muigai and Mr Juma query how and when the cost of the railway was varied from the initial Sh220 billion. The same queries were raised by Mr Ruto, despite attending the ground-breaking ceremony of the project expected to conclude in 2017. The latest queries come on the back damning accusations and counter-accusations of corruption between Jubilee coalition partners over the tender.

More details are expected to be revealed by the Nairobi Law Monthly in an upcoming issue.

Meanwhile here is the shocking revelation as was reported the current issue of the Nairobi Law Monthly ‘s Ken Opala published on 2nd December 2013.

Storm Over Railway Tender

In what would amount to Kenya’s priciest shame, three top State officials wedged themselves between a leading Chinese contractor and Kenya Railways in a bid to skim off billions from the Sh320 billion Standard Gauge Railway Construction project that involves erecting a 485km rail track from Mombasa to Nairobi.

To accommodate the atrocious kickback, the tender was thus inflated by 46 per cent. The quartet shared out a staggering Sh32 billion (with the three state officers each receiving 30 per cent of the cut). A notorious Mombasa wheeler-dealer of Asian descent who brokered the deal took home a cool Sh3.2 billion, according to impeccable sources. By all standards, this is the most expensive bribe in Kenya’s history – far much bigger than the Sh13-billion Goldenberg infamy of the 1990s.

The taxpayer stands to lose a whopping Sh110 billion in inflated pricing, according to railway construction costing made available to this publication by Industry experts. The benchmark in this case is the Addis-Djibouti railway whose construction is to complete in 2015. “The unit cost of Mombasa-Nairobi railway is 49.3 percent higher than the unit cost of the 743km Addis Ababa-Djibouti railway,” said a report by one of the Industry experts working at the Ministry of Transport headquarters, Transcom House.

Inflating contract prices is an age-old fraud perfected by civil servants. That’s why it was convenient in this Railway contract, KRC/PLM/31/2012 and Tender KRC/PLM/31/11. One, the contractor, China Road and Bridge Corporation (CRBC) undertook the project’s feasibility study. By implication, the bill of quantities (BQ) was based on this study – a clear conflict of interest. With the absence of competition, owing to direct procurement, CRBC set its own price. Two, top officials in the Mwai Kibaki-Raila Odinga Coalition as well as Transport Ministry were eager to play ball for obvious purpose – scent of huge bribe.

It is against this backdrop that, according to documents in our possession, KR Corporation awarded CRBC, a Chinese state-owned company, the tender in circumstances clearly suspect. Not only is CRBC undercapitalized, it has never undertaken a project of such magnitude. And that’s apart from the foreboding queries the Public Procurements Oversight Authority (PPOA) raises, as we will see later in this article.

For legal reasons, this publication will not divulge identity details of the four swindlers of the public purse. However, we cannot hesitate to report that an immediate former Cabinet minister, a senior official in Ministry of Transport, and a top politician are the architects of the ignominious plan. They connived with an infamous Asian fixer who operates within Kenya Ports Authority and has vast business interests at the Coast.

Fear is rife this questionable deal will embarrass the Jubilee Cabinet. “This thing is bigger than you people regard,” said a senior official in the office of the Presidency. “It is bigger, ack on its initial plan to hire a more experienced and capitalized company. Officials of China Railway Construction Corporation (CRCC) Ltd – which is building the relatively inexpensive Addis-Djibouti Railway – met the Kenyan delegation in China last August where the project was discussed. CRCC is the largest state-owned engineering company in China; it has done railway works in Nigeria, Algeria, Saudi, Angola, Libya and Israel.

In fact, CRCC Board chair Mang Fengchao wrote to President Kenyatta September 30, 2013 to follow up on discussions he had with the Kenyan delegation. “It will be highly appreciated if (you) could facilitate and instruct the related ministries and authority to receive our (delegation coming to Kenya), and to negotiate and sign the (memorandum of understanding) on the captioned railway project according,” Mang wrote.

Only that Mang’s letter came a bit too late. It would appear part of the Kenyan delegation was on a fishing expedition in China – for the most generous briber. If anything, the existence of Kenya-CRBC MoU was common knowledge. Indeed, MoU had been signed on August 12, 2009. The then Minister for Transport Chirau Ali Mwakere and CRBC general manager Du Fei signed it, setting off events that would eventually lead to the contentious contracts. The MoU, interestingly, provided for the project’s feasibility study.

“Within 30 days from the execution of this Memorandum, CRBC shall provide MoT (Ministry of Transport) with a list of requirements with respect to information which CRBC would like MoT to supply for the study, within 30 days from receipt of the list MoT shall furnish CRBC with the information requested by CRBC provided such information is available to MoT. “As soon as practicable after execution of this (MoU), CRB shall organize and appoint a team of experts to undertake the (feasibility) study. The CRBC shall present the study to MoT within 5 months from the date of this Memorandum.”

It would appear the MoU and subsequent feasibility study was part of a bigger strategy to award the contract to CRBC. No wonder Transport Ministry moved exceedingly fast to cancel the project’s feasibility study contract KR had awarded an Italian firm, Italfer SPA, regardless of the fact that Parliament had in 2010 given the Ministry Sh700 million for the study.

“Where is transparency in an arrangement where a foreign contractor conducts the feasibility study on terms of references it has itself drawn, does the engineering designs on its own, and then proceeds to organise and facilitate for you to get a loan from his country? When a contractor does for you feasibility studies and designs, how can you be sure of getting value for money”, journalist Jaindi Kisero would later question in his column in the Daily Nation, August 20, 2013.

Indeed, experts see conflict of interest in this case. “They arrived at the project pricing based on their own study; interesting,” says an official in the Ministry of Transport convinced staff in his department were all along opposed to the project. “The Government didn’t have a say in this. Brokers did the bidding.” According to sources, the whiff of a scandal was first detected by the Public Procurements Oversight Authority and several other top State offices. Last month a senior State official in the Office of the Deputy President raised the matter in a letter to AG’s office. “We have reviewed documentation of the project … and we have detected numerous prima facie (apparent) anomalies in the tendering-award process and documentation contrary to Public Procurement and Disposal Act (Act no.3 of 2005) and other laws of the Republic of Kenya,” Chief of Staff Marianne Kitany told Prof Githu Muigai.

It is copied to Engineer Michael Kamau (Cabinet Secretary, Transport and Infrastructure), Joseph Kinyua (Chief of Staff, Office of President), and Maurice Juma (Director General, Public Procurement Oversight Authority). Incidentally and inexplicably, the same letter isn’t copied to the Kenya Railways as one would expect, given that the corporation awarded the tender to the Chinese company.

In the letter, Ms Kitany asks the government’s chief adviser to “expeditiously” review the project documentation and render “the requisite legal opinion regarding the same” by November 5, 2013. However, the letter hardly isolates the irregularities, an issue which the AG appears to raise too.

“We would like to request you to kindly highlight the anomalies that you have detected in the tendering-award process and documentation contrary to the Public Procurement and Disposal Act and other laws to enable us issue a comprehensive legal opinion on the matter,” Christine Agimba, the deputy solicitor general wrote back, November 7, 2013. Note the two-day delay!

A sequence of events reveals a very frightening situation – the procurement entity, KR in this case, tried as much as possible to justify awarding the tender to the Chinese company. It changed goal posts so to speak, to ensure CRBC eventually got the contract to build the 485km long rail and also provide the incidentals. As earlier noted, PPOA appeared to doubt KR’s shift in procurement procedure. If anything, it was the same KR that had on October 2, 2012 written to the Authority explaining its decision to use direct procurement. On January 15, 2013, PPOA director general Maurice Juma wrote to KR requesting justification of this method vis-à-vis Kenya’s law, the Public Procurement and Disposal Act.

According to PPOA, the tender was being procured “based on (an MoU)” between Ministry of Transport and the Chinese company – which was clearly irregular. The following month, Kenya Railways Corporation wrote to PPOA retracting the tendering it had submitted to the authority. The report, it said, “was in error” and “wished to withdraw”. It said it had withdrawn and opted for a G-to-G arrangement because the earlier method was against the spirit of the procurement law. Apparently, KR’s decision was unilateral. Neither PPOA nor the AG was involved in identifying the best procurement method for Kenya’s largest investment ever.

It now emerges that the AG had in fact forewarned KR about the tender award, as early as October 3, 2012 – a day after KR wrote to PPOA explaining its decision to use direct procurement. The government’s legal adviser had cautioned, thus “the procurement process shall be subjected to Financing Agreement and therefore Section 6 of the Public Procurement and Disposal Act shall apply”.

Based on the correspondence between KR and PPOA, it would appear the latter was thunderstruck by two conflicting statements in just a week, all from KR. On March 21, 2013, the rail corporation told the Authority that the G-to-G documents were unavailable because of the “ongoing discussions between the two governments on funding arrangements of this project by the Exim Bank of China”. Five days later, the same KR to PPOA to say it had cancelled the Chinese award tender. “The procurement is a G-to-G contract which is to be funded by negotiated grant/loan and is therefore exempt from the application of the PPDA 2005”.

On April 5, 2013, just after receiving letter from KR that annulled the initial contract, the Authority’s director general asked Prof Githu for counsel. Incidentally the office of the AG hadn’t received any documents on the G-to-G deal, over a month after KR’s cancellation of the contract. “To ventilate the question whether its provisions support the construction of a G-to-G arrangement, this office would need with full details of the relevant agreements.”

The AG appears to decline to talk about the merits of the case but he cautioned against selective use of a single piece of law to justify an action. “We must read the statute as a harmonious whole, and the separate parts … should be interpreted within their broader statutory context in a manner that furthers that statutory purpose. It is also general case that laws have meaning, and statutory interpretation must strive to give effect to the meaning”.

He says the PPDA 2005 was enacted to “promote fair competition, transparency and accountability, as well as local participation in public procurements in this country”.

“It created and sustains a framework of competition in public procurements that must be taken as establishing general rules, to which all actors in the realm ought to be deferent under the doctrines of the rule of law. In effect, any deviations from the general principles of application under the law must be the exception rather than the rule.”

As regards G-to-G contracts, Prof Githu says it shouldn’t be used as a means of procurement but “merely bases that could support procurement activities subsequently”. In effect, he says, “it is my opinion that a so-called government-to-government agreement is not a method for selecting suppliers so as to support the award of a contract absent an actual process of selecting project developers, and so on”.

In his letter to Mr Juma, the AG cites Article 227 of the Constitution, which, he says, should be respected to the uttermost.

“That is to say, public agencies are expected to implement procurement methods are fair, equitable, transparent, competitive and cost-effective, and in the instant case, the full application of Cap 412C Laws of Kenya, with the exceptional procurement methods being such, and not the norm.”

Contacted by The Nairobi Law Monthly, CBRC general manager (Kenya branch) Li Qiang discounted bribery claims. “There was no pressure or any kickbacks. The project is on, as much as I know. There wasn’t any bribery.”

Transport Cabinet Secretary Michael Kamau (who, incidentally, was the accounting officer, Roads Ministry in Mwai Kibaki government) is convinced all is well with the project.

“This is Kenya’s chance to prove that it is an economic powerhouse by linking East and West Africa. If this fails, the economic loss may be huge,” he was quoted by the Daily Nation. “The Judiciary should stop this thing,” Cofek’s Mutoro says. “The two attorneys, Amos Wako and (former) Githu Muigai should be held criminally liable for misleading the government and for withholding information from the public.” According to Mwalimu Mati, the Mars Group chief executive, “there are Chinese brokers in Kenya who have squeezed themselves between projects and senior state officers. They are salespeople.”

PHOTO | SALATON NJAU Mr Maina Kamanda (right), chairman of parliamentary committee on Transport, Public Works and Housing, with Mr Alfred Matheka, Kenya Railways acting MD, during a tour of Kenya Railways projects on October 18, 2013. NATION MEDIA GROUP

Business rivalry between powerful brokers targeting multi-billion shilling government tenders is threatening a political explosion in the Jubilee government even as President Kenyatta moves to forestall dissent.

The growing tension, the Nation established, has been precipitated by a recent fall-out in the Sh1trillion standard gauge railway line project launched by the President two weeks ago.

Chinese vendors eying multi-billion tenders being rolled out by the Jubilee government are said to have recruited powerful business figures in the country to act for them, causing tension in the government.

“It is true there are powerful cartels working under the command of multi-billion business people. They are viciously scouting for tenders in government and in state corporations. I can tell you there is a mafia in control,” Starehe MP Maina Kamanda said.

ENTRENCHED IN TRADE

Investigations revealed that top businessmen from Rift Valley are up in arms as they struggle to dislodge those from central Kenya already trading with the government.

Mr Kamanda admitted that the railway project was being fought for by influential people, who were pushing for a rival company that was eyeing the tender, but failed after China and Kenya went for a government-to-government arrangement in a single-sourced tender.

Last month, the Starehe MP and seven members of the Parliamentary committee on Transport, which he chairs, visited Beijing where they met top Chinese officials over the railway tender, days before the launch.

“We were in China and we met various Chinese officials, including their minister for Transport, who told us that the China Railways and Bridges Corporation was equal to the task,” Mr Kamanda said.

However, the visit has been questioned by MPs who argue that the committee is supposed be a watchdog and supervisor of tenders.

On Monday, President Kenyatta rebuked some businessmen, whom he accused of funding MPs to support their tender interests.

“We know their tricks. They want to corruptly get contracts and when they lose, they buy MPs to make noise. I want to ask these MPs to earn their living in the right away,” he said.

And his deputy, Mr William Ruto, said: “If you have lost business or a tender please don’t bring your frustrations to us.”

On Tuesday, Nandi Hills MP Alfred Keter, who has caused a storm in the Rift Valley by openly criticising the President and his deputy over the railway tender, denied he was speaking for brokers.

“I have raised pertinent questions on this project. I have said there is overcharging and that Kenya is going to lose Sh400 billion.

I HAVE PAID THE BILL

“Why are they not giving answers? Why are they resorting to side shows?” he asked.

The MP denied that a helicopter he recently used to attend various functions in Nandi was sponsored by some businessmen.

“It is true I have occasionally used a chopper in my constituency, but I have paid the bill. These people use choppers every other time and no one questions their sources,” Mr Keter said.

This thing is mind boggling. The people in charge are all giving their own figures never mind that the same construction company designed the project, costed it with their own feasiblity studies(determining their own fee), they will then build it, supervise themselves and then buy the locomotives themselves. Where does this kind of thing happen? This is beyond theft. Little wonder the M.Ps were fighting on should do the oversight. Maina Kamanda wants to it by force even though parliament ruled it should be done by the PIC.

Yeah this is the mother of all heists. It is amazing how the thieves are just watching this thing roll on and pretending like nothing is happening. The other lie they had that this was some kind of free money from the Chinese is rubbish. The loan has a fairly high interest rate rate (close to 7%). This thing could bankrupt the country down the line. Everything about this is a fraud.

Uhuru’s brokers are deadly and Ruto has been reduced to his watchman. It is terrible.

This is a combination of the old thieves and the new thieves. It is interesting that the fool who was the Managing Director for the Kenya Railways is now the principal Secretary in the ministry working with this Kamau who is the CS. The new PS was was part of the crew that gave the project to the CRBC way back in 2009. It is obvious that is why he was brought in the new ministry to work with the new crooks. They have come with some crazy figures about building corridors to protect the railway from wildlife and such nonsensical ideas.

How on earth to you build a railway inside a bunker. I have never seen that anywhere in the world.

Adongo and Akinyi,
This must be the greatest rip off in modern times anywhere on planet earth.
Check this out, these guys want to acquire 2253 hectares of land for the so called railway corridor at the cost of 8 000 000 000 shillings, This translates to 3,550,821 per hectare. Where on earth does thing kind of thing happen? How much will this thing cost by the time it reaches Kisumu, if at all it reaches there?

Interestingly, only a few people have started questioning this deal. But things that the thieves thought were buried are now surfacing. But the question is, will Uhuru just go on with this project inspite of all the protests?

Adongo,
The point is that the Uhuruto crew thinks that they can simply talk their way through this corrupt deal. As far as I see it, should this fail to convince the public, they will go on with the project tupende tusipende. There is too much to pocket here to let the thing collapse. The twist and turns in this project and lies that keeps on shifting like liver in ones fingers has made it impossible for many Kenyans to actually gauge the volume of loss they are about to suffer.

The level of corruption in this project is only coming out in the light in trickles. It looks like the Uhuruto chaps have given order to those involved to defend the project as if their lives depended on it. That’s why we see all manner of contradictions on daily basis.

My biggest question is this, who will stop these mobsters from running the economy? As Shaw points out, this thing is due to raise the external debt by 17%. Think about it again, 17% for a project that might not even been profitable in future.

This is just a rip off. They have 5,500 so called would be tenants and they are expecting them to refund the Kshs 5.03 billion which they are grabbing from the NSSF to build houses in plots that were themselves grabbed from the NSSF. Every tenant will have to pay Kshs 1 milllion for these houses. Really? This is a scam. Ati they are also going to build the infrastructure including roads and everything else. This is a mess everybody can see. Kambi the point man for the scam said they have already signed the contract and if it is cancelled they still have to pay. Let him ask his boss Uhuru to pay.

Adongo,
The Jubilee government has found a true partner in crime. One who does not tell or care about the people. Im talking about the Chinese who are involved in all manner of “dirty” projects in Kenya. Truth be told, China is still but a third world country in the way they do things. The recently found wealth in that huge country with large numbers of poor people has helped the elite only. The Chinese government is as rotten as the firms they send to work with rotten African governments. All they do is so opaque that they have become a corrupt CEOs dream. Thats the reason NSSF has hired them.

Uhuru told us recently that the railway project will go on wether we like it or not. Tell me what will stop corruption in the country if the president is ok with and supports the vice. Putting criminals is power has consequences.

Oh Lord,
I had said previously that the top leadership of this country are the ones behind the deals being pulled in the SGR. So when Uhuru talks of shadowy figures, he might as well be talking about himself and his DP. Why in hell cant a president name shadowy figures out to fleece the largest project since independence? What is he fearing?

Even as Deputy President William Ruto stood next to President Uhuru Kenyatta during the ground-breaking ceremony for the standard gauge railway on Thursday, details are emerging of last-minute efforts by his office to ditch the project.

In a letter dated October 28, the Deputy President’s office asked Attorney-General Githu Muigai to give an opinion on the legality of the project, with a view to halting the process due to “numerous anomalies in the tendering award process”.

“By this letter, we kindly request your office to expeditiously review the project documents and to render the requisite legal opinion regarding the same on or before 5th November 2013,” the letter signed by the Chief of Staff, Ms Marianne Kitany, reads in part.

“It is imperative that His Excellence the President should not be seen as giving the project his seal of approval unless all the required procedural and legal steps have been undertaken, and the project is one which is completely above board.”

The letter is copied to Transport Cabinet Secretary Michael Kamau, the Public Procurement Oversight Authority and Mr Joseph Kinyua, the Chief of Staff in the Office of the President.

Mr Kamau has defended the project saying there was no irregularity occasioned by failure to conduct a competitive bidding, adding it was a government-to-government agreement.

The Ministry of Transport and the Kenya Railways have pushed for this position even when they appeared before Parliament two weeks ago despite having received the AG’s opinion faulting the reasoning.

Interestingly, it is the current Principal Secretary for Transport, Mr Nduva Muli, who was the managing director at Kenya Railways when the deal was struck.

The AG’s opinion questions why Mr Muli, in his capacity as managing director of Kenya Railways, flip flopped in choosing the procedure to follow, only picking two processes which do not allow competitive bidding.

In an opinion rendered to Public Procurement Authority, the AG faulted the process used to award the tender.

In his opinion, which is likely to carry weight in court in a case filed by a trade union, given that he is the chief government legal adviser, Mr Muigai noted that the tender award process followed by Kenya Railways Corporation “raised suspicion”.

“We have reviewed the documentation of the project and have detected numerous prima facie anomalies in the tendering award process and documentation contrary to the Public Procurement and Disposal Act 2005,” the letter reads in part.

PROCUREMENT ACT

The AG faulted the use of the government-to-government negotiated loans to avoid following the provision of the Public Procurement Act which requires all projects above Sh500,000 to use open tender to pick suppliers.

In a letter dated October 3, 2012, Kenya Railways awarded China Road and Bridge Corporaton the contract based on direct procurement process.

However, in an apparent afterthought, Mr Muli wrote to China Road and Bridge Corporation in a letter dated March 14 to withdraw the letter awarding the contract.

This after the PPOA questioned the process and demanded Kenya Railways to justify why they were using a direct procurement process instead of competitive bidding.

On March 27, Kenya Railways wrote to PPOA, saying they had cancelled the tender and explained this was informed by the fact that the procurement is a government-to-government contract which is exempt from the Procurement Act.

“Our report submitted to you dated October 2, 2012 showing this as a direct procurement was in error, and we wish to withdraw the same,” Mr Muli wrote.

It is this flip flop by Kenya Railways that made the AG to question why the corporation was avoiding transparency in awarding the contract.

“I must record that it is worrying that a procuring entity can pick and choose alternate procurement methodologies … neither alternative admits of open competition,” the AG noted.

Equally, the AG added, even if the contract was a government-to-government one, Kenya Railways was not exempt from conducting competitive bidding in selecting the winner.

“Government-to-government agreements also demand compliance with procedures outlined under the Public Procurement Act,” says the AG in his opinion.

Prof Muigai further told the PPOA that “government to government” agreements are not a method of selecting suppliers or supporting awarding of a contract.

In what appeared to be a call to respect Kenya’s sovereignty, the AG further noted that “development partners – China in this case – should align themselves to the systems, standards, procedures and development priorities of recipient states in order to promote accountability.”

Mr Kamau, however, seems to fault this, telling Parliament that Kenya had no alternative other than to follow the Chinese rules as Beijing was the one footing the bill.

“… We had to follow their (China’s) procurement procedure,” Mr Kamau told the House. The AG, however, says following the procurement law is mandatory when taxpayers’ money is being used to fund a project. In this, the funding is shared at 85:15 between the Chinese loan and funding from taxpayers. Taxpayers are already feeling the pain after the imposition of a 1.2 per cent railway development levy.

It has also emerged that members of the parliamentary committee on Transport, Public Works and Housing, who were investigating the matter, are fighting over a trip they made to China as part of their investigations on the tender.

The committee, chaired by Starehe MP Maina Kamanda, is investigating why the tender was not subjected to competitive bidding and whether China Road and Bridge Corporation has the capacity to implement the project.

On return to Kenya the committee members have been accusing each other of having received preferential treatment while in China. None of the MPs, however, wants to go on record. At the same time, the High Court has allowed a trade union to contest the award of the tender.

It’s the deadly season of “our turn to eat” and barely 9 months into government, the thieves have began fighting for the spoils. The scale is earth-shattering.

A 350 Billion Shilling Project has been inflated into a 1.2 Trillion Shilling Project.

This expos`e reveals Ruto’s restless aggression towards the Kiambu Mafia that seeks to surround Kenyatta to execute “our turn to eat” in isolation of Ruto. Ruto is directly telling them “our” means — Kenyatta (TNA) and Ruto (URP) are joined at the hip.

A definite schism has emanated from Ruto’s prolonged absence at the Hague:

“We know them. Whenever Mr Ruto goes to The Hague for the hearing of his case, they do their own things. They even run things when President Kenyatta is in the country alone, but is too busy to notice anything,” he (Alex Keter) said.

Even the magnitude of the greed is being exposed in public:

“The internationally accepted cost of constructing a standard gauge electric rail is $2 million per kilometre. Why are we spending $6 million per kilometre here? There are thieves in the government who are behind this,” he (Alex Keter) said.

Even as the Railway mega theft continues to boil slowly to its explosion, the NSSF big money rip off organised by Uhuru’s new toy Kambi and others looks pretty bad.

Kshs 5 billion belonging to Kenyan workers is handed over to phony contractors in phony deals. The history of this theft is nuts. In short NSSF bought 1,760 acres of land from Tessia Coffee estate. Then the land was stolen and subdivided. Now the NSSF is supposed to spend another Kshs 5 billion to develop the stolen plots which they no longer own and at sometime in the future get some of the money back. It is a very long tale of mass theft. But now Uhuru’s boys want to grab everything very fast. They are making a lot of mistakes in the process and it is catching up with them.

Despite the outright thievery going on Uhuru has also unleashed the Moi era repression tactics complete with ridiculous accusations against alleged “foreign sponsors” same way Moi used to do when Kenyans were protesting his dictatorship.

We are back to the era of police brutality against Kenyans engaged in a peaceful demonstration against a corrupt sick regime. Our constitution gives Kenyans the right to peaceful demonstration and if Uhuru thinks he can terrify the citizens into silence he is dreaming.

And then we have the rubbish of making stupid claims against agencies like USAID that is doing a lot of work to help Kenyans in very many areas. Moi tried the same nonsense. It never worked. Yesterday they even tried to invent some fiction that “terrorists” were going to use the demo to attack people. Of course terrorists came but they were in police uniform and they indeed attacked people.

One dangerous thing here is that groups like USAID are getting fed up with the senseless atttacks against them. It is worth noting that one of the most successful operations of USAID was a joint project with KEMRI in which they were providing health services to Kenyans all across the country. The project was funded by the Centre for Disease Control (CDC) based in Atlanta. This is the only group I know that had developed mobile health services where the nurses and other health workers use motor bikes to visit every corner. It was fantastic.

Guess what as from July this year USAID and CDC are moving all the activities of this project to Tanzania. When I first heard about this I thought the ministry of health and foreign affairs wil lobby the US government and USAID to keep this project. They have not done that. Instead they are doing stupid things like summoning USAID officials for a dress down over petty nonsense.

Uhuru is going to the US with a bunch of other African leaders. This would have been a perfect opportunity to lobby to sustain such programs. But with the madness going on at State House such things are out of the window. Choices indeed have consequences.

The government has, for a while now, been working on a comprehensive communications strategy.

The aim is to ensure effective, timely, coherent and coordinated messaging across all levels. To that end, the Ministry of Information and Communications has hosted a series of consultative meetings involving a wide variety of groups.

The sessions have involved top officials from the ministry, as well representatives of the independent media; other interest groups, such as public relations and marketing organisations, and the State House-based Presidential Strategic Communications Unit.

But the consultations seem to have been abandoned along the way. The meetings involving private sector players were discontinued and there is no feedback on whether the strategy plans drawn up are being implemented or have simply been shelved.

However, it has become increasingly evident that the government is still woefully short on the goal of clear and coherent public information. And nothing illustrates this better than the statements issued on Wednesday purportedly on behalf of the National Security Advisory Committee.

This important government organ allegedly met and determined that the American Government, through the US Agency for International Development (USAid), is planning to overthrow the Jubilee leadership. The committee, therefore, asked the Ministry of Foreign Affairs to immediately summon USAid officials to explain their activities. (READ: US agency accused of subversion)

This information was communicated through a press statement. The breach of diplomatic protocol aside, the content and tone of the statement distributed to the media beggars belief. The original statement sent through e-mail and social media, and a revised, but hardly improved, version delivered to newsrooms on a government letterhead, were received with incredulity and disbelief.

No self-respecting media house would touch those statements without establishing their authenticity. It is unbelievable that the government would make such sensational claims in a press statement notable more for its illiteracy and incomprehension than for the content.

The government has a highly qualified and competent team at the strategic communications unit. It seems highly unlikely that a statement on an issue of such a magnitude could be released to the public before getting the approval of experts specifically employed to ensure coherent messaging.

Another worrying thing is that the tone of the statement reveals a government going back to the ham-fisted ways of single-party dictatorship, when any questioning of authority was blamed on alleged dark conspiracies planned and funded by “foreign masters”.

All indications are that the statement may have been provoked by the ‘Kenya ni Kwetu’ protests against corruption, misrule, and creeping authoritarianism.

In the past, the allusion to foreign funding and anti-government plots was meant to justify the violent police break-up of peaceful demonstrations. What becomes apparent, therefore, is that those in charge of the State security have not read or prefer to treat with contempt the Constitution, and specifically the entrenched provisions guaranteeing freedom of speech, assembly and association.

That is where the threat to Kenya lies, and not in imagined foreign plots.

In the original version of this story Duale was raving about how parliament is going to stop governors from flying Kenyan flags. He was speaking at this same meeting where Uhuru is also giving orders to governors. First of all nobody gives a shit about who flies the Kenyan flag. Kenyans are more interested in what the governors are doing apart from stealing public money. That is the focus. Secondly the war between various branches of government is irrelevant to Kenyans.

Yesterday both parliament and the senate launched a verbal war against the judiciary because judges had made rulings they don’t like.

M.Ps and Uhuru need to undestand that seperation of powers does not mean that the judiciary cannot make rulings regarding things done in parlaiment or senate. The judiciary have the powers even to declare laws passed by parliament unconstitutional hence null and void. They have done so in the past many times. The judicary has the powers to make rulings on any matter presented to them.

A court giving an injunction stopping the senate from summoning governors is within the jurisdiction of the judiciary. The application will then be heard in full and the court will decided whether the summons are lawful or not. It is that simple. There is no need to panic. There is no need for Uhuru to lecture governors while attending some village meeting. If he wants to talk to governors go to their meeting being held in Mombasa as we speak.

The real problem we have with these governors is that they are not just clueless in terms of what to do for their counties but they are also robbing the money mercilessly. Right now there are nine governors with huge cases of massive theft. Those include Isaac Rutto of Bomet. Kinuthia Mbugua of Nakuru, Ranguma of Kisumu, Kabogo of Kiambu many others.

Even the showboat guy from Machakos have been fingered for misuse of close to Kshs 50 million. Some money he just took and never gave any reciepts. He calls them confidential expenses. Never mind that the once shinny governor also put in his facebook a picture of himself and his alleged First Lady while it turns out he is married to a different woman with whom they have three kids. So there we have the first governor to post pictures of his First mpango. Of course his real wife is furious about the circus but that is another story. Kenyans are something else.

The nature of the rip-offs are very crude and easily traceable. These guys have not learnt that stealing requires a little intelligence. Even bank robbers have to plan their operations carefully otherwise they will end up with bullet holes in their head.

The governors are reported to have simply grabbed money in millions and didn’t even bother to have some fake vouchers and reciepts. Others have bought houses worth tens of millions. Some have bought cars which they simply register in the names of individuals. You can’t do that.

The problem for these governors is that the grand thieves at State House are not going to help offer cover for them. Those guys are busy with bigger animals to slaughter and eat. They are doing billions and they will be glad to see the governors catching fire because that will deflect attention from them. So that hammer is coming if the EACC can wake up.

The thing that still drives me crazy about the governors are their misplaced priorities and showboat business. Mutua did a big showboat with buying a whole bunch of police cars. On the surface it looks good until you realize that it is an act of grand stupidity and a waste of money.

Security is under the docket of the national government. There is a huge budget in the interor ministry to buy police cars. Mutua has no business grabbing county budget to buy police cars and promising to use hundreds of millions to build houses for cops. Use that money to invest in development projects that will have direct impact on the lives of the folks of machakos and demand that the national government take their responsibility for security seriously. It is their single most important job.

I like the ambulances too but I would rather they start by fixing the hospitals, health clinics and buying medications to stock the health centres. Then hire staff and then you need the ambulances. If you can’t do that then buy coffins and those funny looking vehicles used to transport dead bodies to the cemetary. Don’t rush people to hospitals where they wouldn’t get any treatment. But at least misplaced priorities are not as bad as outright theft going on in the counties. Many of these governors are going home soon. We can’t wait.

As you all know the Anglo Leasing robbery scheme is back in full swing. Uhuruto have decided it is time to pay for air and it is not oxygen. It is the other one. They don’t even want Kenyans to know who the air suppliers being paid are. Just pay and move on. The initial amount is Kshs 1.5 billion.

Once we pay that there is another Kshs 123 billion from 17 other air suppliers that will be asking for our money. They will have to be paid “to keep Kenya in the good books” of international financial lenders. So they say. That is pure rubbish. This is extortion by the state to fund their money bags

I think Ayang’ Nyongo’s response in this opinion piece captures the essence of this whole sad circus:

Crunch time. These guys are bankrupting the state. They want to pay thieves Kshs 125 billion so that they can issue bonds to raise money. Now they can’t even pay existing loans and interest. They are borrowing money to pay old loans and interest:

Githu sabotaged the Anglo cases in London by sending the Solicitor General who is not even qualified to practice law in England. He was told to get lost. Githu was then supposed to pay qualified lawyers in England to represent the government.

Githu with instructions from his boss of course sabotaged that too. The thieves had a walk-over. Now the little devil wants to lie to Kenyans that this was all Wako’s fault and he just came in as the mortician to prepare the nation for burial. Now he has done that job but Wako is telling him the truth. This case was decided last year and early this year long after Wako left the A.G’s office. Githu was given a live patient as he was the new surgeon. He decided with instructions from his boss to prepare the live patient for burial and gave himself the title of a mortician. That must be a lot of fun.

Here are some of the details of this never ending nightmare. The Kenyan media has not even bothered to ask for the details of the cases. They just recycle political speeches by the same criminals.

And yes the country is on the verge of bankruptcy. One month to end of financial year and there is no money. They are gambling in the Eurobond which they have already included in the budget and still the budget is under water. If the bond doesn’t yield hundreds of billions, the government may have to borrow money from Equity bank at 20% interest and belly up the economy. Plus tourism is dead. What to do now?

The issue here is that Uhuru does not have powers under the constitution to order expending tax payers money by decree. All government expenditure has to go through some budget whether the national budget or a supplementary budget and any such budget and payments must be approved by parliament before any money is expensed not after. Essentially what Uhuru has done here is illegal. He has broken the law. Nothing new there.

The problem is that under the new constitution any state officer who illegally spends public money is liable to pay back the money to Kenyans. Uhuru may be above the law but Rotich is not above the law. Rotich cannot take cover that he was ordered by Uhuru to pay the thieves. He is liable for making the payment. This was the problem we had with the M.Ps pay increase where the Clerk of the National Assembly could not pay them until after the SRC agreed with their increased salaries and benefits. They got that done but Uhuru seems to think he is the law unto himself. He is dead wrong.

Again I am hoping we can work with some people to take this matter to the court and have Rotich held accountable. Uhuru can help him pay the money back. I am going to find out if the LSK which had already filed a case on this can also look into this angle. That is next.

Adongo, you are right that the government’s economics is very puzzling. Most of the Eurobond will go to pay for a syndicated loan that has been rescheduled at a high cost, what looks like a huge hole in the next budget, and then interest on other loans. That can work this year but I am surprised to see nobody talking about deficits and loan repayments next year and after that. It looks like the government will have to borrow (via the Eurobond) a huge amount and at fairly high cost. Plus growth forecasts so far did not take into account possible disruptions in tourism, which is a big FE earner.

Adongo,
You are right about the Mortician and his Anglo-fleecing antics. The moment Uhuru opened the flood gates all manner of characters have all of a sudden without shame joined the race to get pay. The very architect of the scandal Mr. Perrera is now asking for 3.5 billion shillings more.

The Mortician will probably advice Uhuru Kenyatta to pay. Read more here:

Mzee, it is not “all manner of characters”. Mr, Perera is the chap who just got Sh1.4 billion. He’s just striking while the iron’s hot. From what I remember, of the 18 contracts in question, 15 or 16 can be traced back to Perera and Kamani as the fronts. A lot in Kenya seems to depend on this Eurobond issue, so I don’t see any option other than paying them.

All in all, I see it as a real shame, coming at a time when there appears to be an impending famine, not to mention numerous security issues, all of which will have a significant impact.

This is a very telling facebook commentary about the whole anglo thievery business.

[Comment by Blog-Admin follows]

Adongo, this is brilliant, and have reprinted the entire text below – will reformat as soon as I have the time

_________

Thomas Ojanga
Yesterday at 7:19am · Zürich, Switzerland · Edited ·
Anglo Leasing – my two cents worth:
———————————————
The Anglo-Leasing saga has become part of Deji Rahman’s circus of the absurd and it continues to provide more material for that collection. The conduct of the Jubilee coalition, CORD, the AG, the President, the LSK and Ababu Namwamba ‘s PAC have one common denominator: To stupefy the nation. I will therefore attempt to put certain facts in the public domain. Maybe then, Kenyans may understand what this circus is all about.
1. The President, the AG and some Jubilee political “choir members” and obviously semi-illiterate lawyers are claiming there are some two international court judgements from Switzerland and the UK that must be honored by paying the Anglo-Leasing invoices – evidently and well known scams by elements of the previous and current political dealers. This is totally untrue. I will explain: Requested by KACA, the Swiss opened investigations on Anglo-Leasing and found a clear case of Money laundering which is a violation of Swiss laws. Subsequently, Anglo-Leasing accounts were frozen. The bank accounts had a total of Swiss Francs 160 million (ca 16 billion Kenya shillings). Anglo-Leasing then accused the Kenya Government before the cantonal court of Geneva of non-payment of fees for services previously rendered or violation of contract. Through neglect and possibly by intent, the Kenya Government lost the case. This is the judgement Uhuru Kenyatta, the AG and the political class are talking about. But it is not the only payment they intend to make.
2. First, the judgement by the cantonal court of Geneva is not an international court judgement as Kenyans are being told. It is not even a national court judgement in Switzerland. A judgement by the cantonal court DOES not automatically trigger enforcement of debt collection in Switzerland. After the judgement, the insolvency law of Switzerland of 11 April 1889 (yes, Eighteen Eighty Nine), codified in the Federal Statute on Debt Enforcement and Bankruptcy (Bundesgesetz über Schuldbetreibung und Konkurs / Loi fédérale sur la poursuite pour dettes et la faillite) comes into force. What this means is that Anglo-Leasing can thereafter initiate debt enforcement proceedings (Betreibungsverfahren / procédure de poursuite) by filing a debt collection request (Betreibungsbegehren / réquisition de poursuite) against the Kenya Government.This must be done at the competent cantonal debt collection office (Betreibungsamt / office des poursuites) at the domicile of the Kenya Government in Switzerland. The debt collection office then serves a summons for payment (Zahlungsbefehl / commandement de payer) on the Kenya Government. But since the Kenya Government does not “live in Switzerland” the debt becomes invalid and unpayable. The permanent mission to the UN is protected under Swiss Law and enjoys immunity status. Dead end!
3. Secondly, enforcement of a decision against assets of a State or its instrumentalities, including the execution of awards rendered on the basis of the 1965 Washington Convention on the Settlement of Investment Disputes between States and Nationals of other States (which does not apply in the case of Anglo Leasing) can only be done through the Swiss Federal Supreme Court. This is not the case for Anglo Leasing.
4. Even if the Washington convention were to be applied (Uhuru and Muigai insinuated) the Swiss Federal Supreme Court applies the concept of State immunity restrictively. It distinguishes between matters involving foreign States acting
in their sovereign capacity, i.e. de iure imperii, and those involving foreign States acting in a private capacity, i.e. de iure gestionis. Where the State
acted de iure imperii, sovereign immunity applies and the State cannot be a party to proceedings before Swiss courts. Anglo Leasing becomes a dead end here again.
4. Fourth, where the State acted de iure gestionis, sovereign immunity from jurisdiction may only be lifted, provided the matter has an ‘appropriate’ connection with Switzerland (“Binnenbeziehung”/“rattachement suffisant”). Such connections are deemed to exist where the claim originated or had to be performed in Switzerland. The mere fact that Anglo-Leasing has some letter-box address in Switzerland is not sufficient to create such a connection. Under Article 92(1)(11) of the Debt Collection and Bankruptcy Act (the “DCBA”) of Switzerland, “assets belonging to a foreign State or a central bank and assigned to tasks which are part of their duty as public authorities” are immune from execution measures. Again here, the claims are dead on arrival in Switzerland.
In conclusion, that the claims, purportedly enforced by a Swiss court, have been paid through a law firm and bank account in England should be an indication to Kenyans that we are facing day light robbery. Thing is, if it was paid through Switzerland, it would be frozen. So they paid for it through England. Truth is that some people in the government want Anglo-Leasing Swiss frozen 16 billion to be released. To achieve this, they must prove that the so-called corruption that made the Swiss freeze the money does not exist. This can only be validated by the payment of the 1.4 billion shillings. They want 17 billion shillings. Don’t focus on 1.4 billion shillings only.

The jokers now say they cannot refund VAT money to businesses. You collect peoples’ money(cash) and you want to pay them with IOU papers? Where did the money go? These chaps are way over their heads. At this rate that whole Eurobond cash will be spent before it reaches the Central Bank. The republic is going broke before our very eyes: Uhuru now has to run a Ponzi scheme. Borrow from Equity and MPESA the cash to angry people whom the government owes money. That is a very dangerous territory.

CORD has proposed to the besieged Jubilee leadership a need to initiate a joint effort to address some pressing national issues. Uhuru with his hangers on have tried to ridicule this effort and go on as if they are actually taking care of business. They are not. Personally I was skeptical about this big noise about national dialogue. Our politics is too primitive to allow such discourse. We are doomed to politics of perpetual conflict.

In other countries even where there is endless bickering like the USA, at critical times we will see bi-partisan bills being sponsored in Congress and in the senate to address issues that are pressing to Americans. Such bills are the most successful. In Kenya there is just no possibility for a bi-partisan legislation to address critical things like the sky-rocketing cost of living. M.Ps are drunk with power and they will scream about tyranny of numbers to defeat even common sense legislative efforts.

The only time all Kenyan M.Ps and politicians from all parties come together in a love fest is when the M.Ps and senators want to raise their salaries and benefits to help them become instant millionaires. They can do that within minutes. But when it comes to dealing with problems that affect the millions of Kenyan working people and the poor, that is not a priority. Never has been.

The way Jubilee has responded to CORD’s initiative gives CORD a perfect opportunity to actually take action that is going to resonate very well with Kenyans.

Here is what CORD needs to do.

1. Stop talking and start your own efforts to address the problems Kenyans face. The first step is to set up a small committee of M.Ps, Senators and some governors to address the sky rocketing cost of living that is endangering the survival of many Kenyans. High prices of basic necessities does not discriminate between Jubilee and CORD supporters. They all go to the same super markets and have to deal with prices of basics which they can no longer afford.

CORD should set up a Cost of Living Committee (CLC). The committee should focus on ways to revisit the VAT impact on basic commodities. There was an attempt to do this but it was not done properly and very good amendments sponsored by M.Ps like Mbadi were so watered down by the Jubilee hawks that they ended up just white washing VAT here and there.

It is now time for the government to eliminate all VAT on all basic needs. Kenyans are in crisis. People can’t afford basics. Kenyans need an urgent move to make food and other commodities affordable to them. The government will lose some money from VAT but in a crisis you have to act.

When the tourism sector faced a major crisis after the security problems became explosive Uhuru sat down with industry leaders and came up with some solutions. Some of them are knee jerk gimmicks but that is a discussion for another day.

Now that the nation is faced with the dilemma of terribly high cost of living the same has to be done and real solutions developed. The government is not going to force producers and traders to reduce prices but the government has the power and the tools to eliminate VAT on basic goods, products and services that Kenyans depend on and it will have a huge impact on the quality of life for millions of Kenyans.

When Uhuru’s sacred cow called Anne Waiguru was facing some form of censored in parliament, Uhuru bent backwards and was even forced to invite M.Ps to state house to save his sacred cow. That is Uhuru’s priority and he had to bring everybody together to help her.

The lives of Kenyans facing starvation and unacceptable high cost of living must be somebody’s priority in Kenya. CORD can start that process as early as this weekend when they assemble in Mombasa. Announce the committee. Announce its terms of reference and expected results and provide the timeline for this which should be not more than two months. Come with your solutions. Uhuru can take them or leave them. The political price will not be small but it has to be done smartly.

2. CORD needs to address the land issue. The confusion between the ministry of lands and NLC is terrible and harmful to Kenyans and unacceptable. The issue of title deeds is causing major confusion. The CORD leadership of Raila, Kalonzo and Wetangula working with reps from all regions should take on the lands docket and dialogue with Kenyans on what are their priorities in resolving land problems and then take the issues up with the NLC and the ministry of lands.

Issues include how to deal with grabbed land. What is the hold up? When is the NLC going to actually start addressing this very serious problem in Kenya? What is the NLC’s plan of action? These are not state secrets. The NLC plan of action should be out by now for each region. What pieces of legislation do we need to make the NLC fully functional? What is going on with expired leaseholds which are sitting on hundreds of thousands of acres of land? How transparent are the dealings between the NLC and the former leaseholders?

3. CORD also needs to address issues of corruption and procurement. We have the Anglo nightmare. Jubilee is hiding behind the nonsense of saying Raila was in the government with Kibaki when some of the payments were approved. We don’t care if the deals are illegal, they do not become legal because Raila chaired this or that meeting.

If Raila is part of those benefitting from this Anglo thievery, lock him in jail. Uhuru is talking about another set of investigations. This is tiresome nonsense. It is time for action. CORD needs to push hard on the Anglo thieves now. CORD needs to make it clear that they want all culprits exposed and if the culprits include some people in CORD, then smoke them out too.

Ababu is in the committee that has been dealing with corrupt procurement problems including the SGR. Ababu has been sleeping on the job. I know he is not allowed to disclose any issues being discussed at the PAC. But for god’s sakes why is the PAC sitting on the report about the SGR? Ababu needs to be a strong leader of PAC and should work with his colleagues to move things up quickly. Maina Kamanda already up staged them when then he released his own phony report of the matter. What seems to be the problem here.

I have other issues in mind but I have to run now. I will continue later.